Massive Call Option Trade on QQQ! $24 Million Bet on Nasdaq 100 Hitting New High by End of July

Markets are again signaling optimism about the outlook for U.S. tech stocks. On Thursday (9th), a massive $24 million options trade occurred on the Invesco QQQ Trust ETF (QQQ-US), which tracks the Nasdaq 100 Index.

According to CNBC, the trade was executed about 90 minutes after market open. The core position involved spending approximately $30 million to buy 28,000 call options on QQQ with a strike price of $736, expiring on July 31. Simultaneously, the trader sold about $6 million worth of call options with strike prices of $730 and $740 to reduce the overall cost of the trade.

The triple-leg call spread strategy is an advanced options technique involving the 'buying and selling' of three different strike price calls. It is typically used for moderately bullish (bull call ladder) or moderately bearish (bear call ladder) outlooks. The main advantage is reduced entry cost, but it carries unlimited risk beyond certain price ranges.

However, while selling calls reduces premium costs, it also raises the strategy’s breakeven point to approximately $750—just under $2 above QQQ’s all-time high set in early June. In other words, if QQQ does not rise significantly by expiration, this trade could face losses.

Scott Bauer, CEO of Chicago-based Prosper Trading Academy, said, 'If the trader doesn’t have other hedging positions, then they’re betting that QQQ must surge sharply. While the spread lowers costs, it raises the breakeven. If the index only rises gradually, they could face significant losses.'

Despite recent market volatility due to geopolitical factors like U.S.-Iran tensions, the Nasdaq 100 Index has largely traded sideways since mid-May. Its most recent all-time high was set on June 3. According to ThinkOrSwim data, current options activity is concentrated around the $710 strike price, and the S&P 500 has traded in a roughly 200-point range since early May.

Notably, at the time of the trade, the open interest for the $736 strike call matched its volume, suggesting the trader might have been covering a previously sold call position rather than establishing a completely new bullish bet. Therefore, while the trade appears bullish, the actual level of optimism may not be as aggressive as it seems.

Besides QQQ, two other large options trades on the same day also indicated bullish positioning.

One involved the SPDR S&P 500 ETF (SPY-US), which saw a $50 million trade as a trader bought 2,000 deep-in-the-money call options with a $500 strike price, expiring on July 24.

Additionally, nuclear energy company Oklo (OKLO-US) attracted significant attention. A trader bought $46 million worth of January 2028-dated calls with a $200 strike price, and simultaneously purchased $21 million worth of mid-December 2024-dated calls with a $90 strike price. The company’s stock is currently trading around $50.

Despite ongoing disruptions from geopolitical and macroeconomic factors, the consecutive appearance of large bullish options trades reflects that some institutional investors still believe tech stocks and U.S. indices could reach new highs in the near term.